Formal contract negotiations between General Motors of Canada Ltd. and the union representing its Canadian auto workers began with a sense of optimism from both parties at the table.
The first major round of bargaining with the Detroit Three since 2009 focused on contracts at the company's assembly plant in Oshawa, Ont., which doesn't have any new vehicles scheduled for production after 2019.
"I would say we had a lot of really good discussions," said David Paterson, vice-president of corporate affairs at GM Canada, speaking to reporters on Wednesday following initial talks at the Sheraton Centre in Toronto. "In sharing of perspectives, we understand each other and I think we are both equally committed to finding a positive outcome."
Unifor president Jerry Dias shared the sentiment at a separate news conference."They were positive, constructive, and I have to say I'm very optimistic that a fair contract can be reached with all three of the Detroit Three," he said.
The meeting was the first in a month of negotiations between the auto makers and Unifor, Canada's largest private-sector union, which represents about 23,000 workers at GM, Ford Motor Co. of Canada Ltd. and Fiat Chrysler Canada. Existing contracts with the three auto makers expire on Sept. 19.
But despite the air of camaraderie, there were subtle – and not-so-subtle – reminders of what's at stake. Union members walked slowly down the hotel hallway and into the large meeting room wearing white T-shirts with a firm message on the back: "Canada didn't bailout GM for them to invest in Mexico." And on the front, "#GMOshawaMatters" Their message was clear to GM. "We understand that there's a lot of anxiety about Oshawa in particular," Mr. Paterson said. "What we want to do is put together a competitive agreement for Oshawa."
One of the key issues for Unifor is ensuring GM allocates new vehicles to the Oshawa plant, which currently plans to end one of its two production lines next year, cutting 1,000 jobs. Production of the Chevrolet Equinox compact crossovers and the Buick Regal is expected to leave Oshawa in 2017. The company also has Ontario plants in Ingersoll and St. Catharines.
Bargaining is expected to continue until the end of August and a pattern-bargaining target is expected to be chosen by Sept. 5. (Editorial, advertising and circulation employees of The Globe and Mail are also members of Unifor.)
Pattern bargaining is a collective-bargaining technique in which the union uses the precedent of one contract agreement as a model for others during labour negotiations. Unions focus on one company, establishing the pattern that will serve as a template for contracts with the other auto makers. Once a deal is reached with the first company, the focus will switch to the second company and then the last of the three. Unions choose the pattern target based on the criteria that they have prioritized, with new products being the clear focus this round.
"We would love to be the partner that is selected moving forward, as would all the companies," Mr. Paterson said. "But what is most important is that we work to find a mutually beneficial agreement that also ensures we're competitive for the future."
In a written statement, Stephen Carlisle, president and managing director of General Motors of Canada, expressed the factors in mind when making major auto investment decisions, such as shifting market trends, macro-economic factors, local costs for utilities, and public-policy supports and costs.
"While labour costs account for about 7 per cent of our total costs, crafting a positive labour agreement can signal that we wish to put our best foot forward and 'stay in the game,'" the statement said.
However, Mr. Paterson did not voice a clear commitment by GM to new products for the Oshawa plant.
"What we've said really clearly for the last two years is that we won't be in a position to make a competitive investment decision until after the negotiations, so we very much view these negotiations as an important first hurdle that we need to be able to put a competitive case together."
This idea was rejected by Unifor's Mr. Dias, who cited a decision made by GM with the United Automobile Workers a year ago, where the company committed to $8.3-billion (U.S.) worth of investment before talks ended. He said if GM could make that kind of commitment as part of contract negotiations in the United States, along with employing an additional 3,500 people over and above the existing work force, Unifor expects similar treatment in Canada.
"The reality is there will not be an agreement with General Motors until we have solidified the footprint in Oshawa," said Mr. Dias, who when asked about the possibility of a strike said the union would do whatever is necessary to ensure its requirements are met.
GM has been increasingly focusing its investments on engineering and software jobs as technology disrupts the auto industry. In June, the company announced it was adding 700 new jobs in this field in Oshawa, Markham and Toronto.
Negotiations continue on Thursday with Ford and Fiat Chrysler.